FAQ: Is it true that if an LPFM (or NCE) runs a program provided on a "barter", it can have commercials?

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The short answer is, no.

Barter is a term used in commercial broadcasting where in exchange for the rights to carry a program (or for other services, such as ID jingles), the station agrees to carry commercials provided by the producer or syndicator.  In a barter arrangement, no cash changes hands.  It is like a trade. 

Section 399b of the Communications Act states, in part:

(a)“Advertisement” defined. For purposes of this section, the term “advertisement” means any message or other programming material which is broadcast or otherwise transmitted in exchange for any remuneration, and which is intended-
(1) to promote any service, facility, or product offered by any person who is engaged in such offering for profit;
(2) to express the views of any person with respect to any matter of public importance or interest; or
(3) to support or oppose any candidate for political office.

The key word here is "remuneration".  While not specifically defined in Title 47, "remuneration" means "income in the form of a commodity, service, or privilege if, before the performance of the service for which it is payment, the parties have agreed upon the value of such commodity, service, or privilege, and that such part of the amount agreed upon to be paid may be paid in the form of such commodity, service, or privilege" (for an example: 20 CFR 332.2(a)(2)).  Therefore, remuneration is not always cash, it can be other commodities or services.  

There is a common misunderstanding that "consideration" or "remuneration" only applies to cash payments in the noncommercial educational (NCE) context.  This is not correct.

The syndicator is offering you something of value (the produced radio program that you did not have to put out resources for as if you were producing the program yourself), this means that the syndicator is "paying" for airtime on the station.  To carry that program with commercial messages would violate the FCC's NCE policy.  

Some will argue that because the Commission's NCE polices do not specifically use the word "barter", they also don't refer to cash payments specifically. They use the term "consideration", which covers any kind of compensation in exchange for the announcement, whether it is cash, tangible goods or services. 

With that said, the answer to the question is, "no". 

LPFM program content/station operations/noncommercial nature
Answer Date: 
Sunday, March 1, 2020